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| Polski: Sztabka złota ważąca 12,5 kg. Własność Narodowego Banku Polskiego. (Photo credit: Wikipedia) |
London, Jan.10, stock investing .- The gold markets finally showed a little bit of a fight on Tuesday as we managed to bounce and formed a positive candle. However, what should be noted is the fact that we have found significant support at the 1640 level which we had suggested previously was going to be very strong addictive the fact that it was once resistance at the ascending triangle that we broke out of back in late August.
We still believe in the long-term validity of the gold bull market, and as a result we do hold physical gold as well as the GLD ETF. We use the futures market as a way to leverage our trades and continue to benefit from the longer-term uptrend in the gold markets. The last 12 years and been very strong for the gold markets, and we don’t see anything that really changes at this point.
This is especially true when you start to think about the fact that so many central banks are currently working to weaken their own currencies. The Bank of Japan is getting ready to start a massive easing program, and the Federal Reserve is still stuck in that situation as well. The European Central Bank is more than likely going to flood the market with Euros, and everywhere you look there seems to be a “race to the bottom.” It seems like the only solution to the monetary issues of several countries is to simply debase the local currency. In the way and so, many traders out there will look for real currencies such as gold in order to store their present well. After all, if you happen to own most of your wealth in Swiss francs, and the value of the Franc is being manipulated down, you obviously are losing money by saving.
Because of this, we feel that the gold market still has quite a ways to go going forward. Lately there is a lot of talk about the end of the gold bull market, but we have heard us talk several times. In fact, it happens about once every six months, and has simply provided a buying opportunity for well over a decade. Because of this, we are not going to find the long-term trend and do fully expect to see higher prices this year. With this being said, we are more than willing to start buying gold above the 1660 level.
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